New Hotel in Beach City to Aid Tax Base

RUTH RYONTimes Staff Writer

Surf's up in Manhattan Beach but not just for surfers.

The atmosphere in this once-sleepy seaside community is changing as fast as the shifting sands, but the most recent evidence of this has started a couple of miles from the ocean, on the east side of Sepulveda Boulevard, where locals joked for years that there was no life.

The evidence is in the form of the $40-million, 394-room Radisson Plaza Hotel, being built on the south side of Rosecrans Avenue just east of Sepulveda Boulevard on a city-owned site that is also one of the last undeveloped parcels of a former Chevron fuel storage farm.

Project for Entrepreneur

The hotel will have a swimming pool, health fitness center and nine-hole golf course, but it was primarily designed for business people. Watch out, surfers! It may be time to exchange wet suits for coats and ties.

Or, as one local businessman observed, "one of the nice things about Manhattan Beach is that you can surf and still go in the morning to the office."

Known as the Radisson Plaza Hotel, Manhattan Beach, the hotel is the latest project of entrepreneur Horst Osterkamp, the individual general partner, shareholder, director and president of Century City-based US Hotel Properties Corp. and an owner of Don the Beachcomber, a Polynesian-style restaurant.

Will Be Franchise

"We are the developers, owners and managers" of the hotel, he explained in a telephone call from Paris, where he was visiting. Osterkamp attended the University of Switzerland but is a graduate of Michigan State University.

The new hotel will be operated as a franchise under the Radisson banner, but US Hotel Properties is the owner/developer of 15 hotels throughout the United States.

Why build a hotel in Manhattan Beach? "Why?" he asked incredulously. "But of course, because it is in the midst of a large commercial environment with TRW, Data General and that whole, very progressive area from Los Angeles International Airport through El Segundo to Manhattan Beach, where there are 2 1/2 million to 3 million square feet of new offices."

Designed by the architectural firm of Maxwell Starkman Associates with Tutor-Saliba Corp. as general contractor, the hotel will have about 28,000 square feet of meeting and catering space, a gourmet restaurant, garden restaurant and entertainment lounge.

It will have a concierge, 24-hour room service, transportation to and from Los Angeles International Airport, secretarial services and valet parking.

Its 394 guest rooms will include 23 suites.

Prime Income Producer

A major business feature will be a 70-seat executive board room with sloped floor and rear projection equipment for audio-visual presentations. An adjoining lounge and three additional meeting rooms are expected to serve the needs of area industries, especially those involved in aerospace.

It will also have a ballroom and "pre-function area" with a total combined capacity of 1,500 guests. Regan-McNamara of Beverly Hills is completing the interior design.

When the hotel is completed next spring, it will be, said Osterkamp, "the primary income producer for the city of Manhattan Beach." Population: 32,659.

"It will be a heavy contributor," Merle Lundberg, the city's finance director, acknowledged. "I would say that the first year it opens, it will bring in about 5% of the city's entire revenue and about 10% of the city's general fund."

That will amount to about $1 million, he calculated, adding, "It's a good hunk of change."

Ground Lease, Occupancy Tax

By comparison, the Manhattan Village Retail and Entertainment Center, which has been open adjacent to the hotel site for about four years and is currently the biggest sales-tax revenue generator for the city, produces about $800,000 a year.

With the hotel, the city will benefit from a ground lease and transient occupancy tax. By 1994, the hotel is expected to bring in about $2.6 million or an estimated 11% of the city's total revenue and 21% of the general fund.

There are some other hostelry plans in the city, though there has been no new construction of that type there for at least 15 years.

A 176-unit Residence Inn is being built at 1700 Sepulveda Blvd., also on the east side of the street, using a suite concept with kitchens but "geared for business people," according to Steve Lefever, the city's acting planning administrator. And construction of a 40-unit motel at 9th Street, again on the east side of Sepulveda Boulevard, was just approved by the city's Board of Zoning Adjustment.

Abandoned Nursery Site

The City Council is expected to consider that project, which would be built on the site of an abandoned nursery, at its May 21 meeting.

A 200-room hotel proposed for the downtown area is "on hold for the moment," Lefever said, "but we've had a lot of interest expressed in building hotels even though there is one hotel and several motels here already."

Business people already abound. Locals can hardly go anywhere in town to lunch anymore in shorts. Continental restaurants, cappuccino bars and boutiques are almost as common as they are in West Los Angeles, and there are many new homes where old beach cottages stood and on another part of the former fuel storage farm.

In the meantime, local big business is growing.

Said Lefever:

"TRW plans to build more than 1 million square feet of offices" in the area.